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PLAYBOOK TEMPLATES

Reseller Distribution Agreement

A Reseller or Distribution Agreement governs how products are marketed and sold through intermediaries, defining territories, pricing, and performance expectations. This playbook explains negotiation levers around exclusivity, revenue targets, and brand protection.

Warranties and Representations

Why This Matters: Uncontrolled warranties can lead to unlimited repair or replacement obligations. Well-defined warranties provide assurance while capping potential losses.

Negotiation strategy

If you're the Manufraturer:

Ensure the warranty clause aligns with your business goals by specifying the duration and scope. Limit liability by capping potential losses and including clear remedies for breaches.

If you're the Distributor:

Propose a warranty period that aligns with industry standards. Offer options for repair, replacement, or refund to manage potential liabilities effectively.

Essential elements

1

Warranty Duration

Specify the warranty period.
2

Performance Standards

Define product quality benchmarks.
3

Remedies for Breach

Outline options for non-compliance.

Action framework

ACCEPT

Propose edits to align the clause with business objectives and limit liability.

EDIT

Reject clauses that expose the company to unlimited liability or lack clear remedies.

ADD

Add language to ensure comprehensive coverage and mutual protection.

PRO TIP

Always review warranty clauses for alignment with company policy and risk management strategies.

Example clauses

FAVORABLE

Preferred Warranty Clause

"The Seller warrants that the products will conform to the specifications and be free from defects in material and workmanship for a period of [insert duration]. In the event of a breach, the Seller shall, at its option, repair or replace the defective products or refund the purchase price."
NEUTRAL

Standard Warranty Terms

"The Seller provides a warranty for the products as per industry standards."
UNFAVORABLE

Unlimited Warranty Liability

"The Seller warrants the products indefinitely without any limitation on liability."

Fallbacks

Extended Warranty Periods

Evaluate scenarios where the warranty period exceeds industry norms, potentially increasing liability and cost. Consider negotiating a shorter period or additional compensation.

High-Risk Products

For high-risk products, ensure warranties are comprehensive and include specific performance standards to mitigate potential issues.

International Sales

In international sales, consider local laws and regulations that may affect warranty terms and ensure compliance.
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